Health Law and Employment Law Alert: Supreme Court Rules in King v. Burwell

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June 25, 2015

Today, the U.S. Supreme Court ruled 6-3 in the King v. Burwell case to uphold federal subsidies in the states where the federal government is operating the insurance Marketplace under the Affordable Care Act. The majority ruled that the literal interpretation of the provision in question did not make sense in the larger context of the law. In his majority opinion upholding the subsidies, Chief Justice Roberts wrote:

“Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter.”

The Affordable Care Act provided states with a choice to either build their own healthcare marketplace exchange or use an exchange run by the federal government. In total, 34 states decided to use the federal exchanges. Had the highest court ruled against the Obama administration, about 6.4 million people in those 34 states, including Maine and New Hampshire, would have been at risk to lose their subsidies. The Bangor Daily News reported that:

“In Maine, nearly 90 percent of the 68,000 residents who enrolled in health insurance under the law received subsidies to help them afford their monthly premiums. Without the financial leg up, the average premium would have shot up nearly 400 percent, from $88 to $425 per month, according to an analysis by the Kaiser Family Foundation.”